On November 26, 2012, SEC Chairman Mary Schapiro announced that she will leave the Commission on Friday, December 14. Commissioner Elisse Walter will take over as Chairman.

On August 29, 2012, the SEC proposed rules to implement Section 201(a) of the JOBS Act, which requires the SEC to eliminate the prohibition against general solicitation and general advertising (together, “general solicitation”) in securities offerings conducted pursuant to Rule 506 of Regulation D under the Securities Act of 1933 (the “Securities Act”) and Rule 144A under the Securities Act. The Commission voted 4-1 to propose the rules, with Democratic Commissioner Aguilar as the lone dissent, but Commissioner Walter, also a Democrat, expressed reservations about the proposal in her opening statement at the Commission’s meeting. Republican Commissioners Gallagher and Paredes strongly supported the proposed rules.

Although the proposal has been widely praised by the securities law bar and by companies and private funds that would likely benefit from expanded access to private capital if the rules are adopted as proposed, investor advocates have been highly critical of the proposal, arguing that the proposed rules would increase investor vulnerability to fraud. Similarly, a letter signed by seven Democratic senators called upon the Commission to re-propose new rules, arguing that the proposed rules would not adequately implement investor protection provisions in the JOBS Act.

It is too soon to tell whether the controversy surrounding the proposed rules, combined with Commissioner Walter’s previously-expressed reticence about the proposal, will ultimately prevent her from supporting final rules consistent with the current proposal. As the incoming Chairman and the “rubber vote” on this issue, Commissioner Walter will largely control the timing and content of any rules that remove the general solicitation ban.​